Microsoft to respond to new Apple TV with Xbox-based service - report

Microsoft is reportedly planning to take on Apple TV and Google TV with a new subscription service that will be delivered through the company's popular Xbox 360 game console.

Two anonymous people familiar with the company's plans told Reuters that Microsoft is in early talks with content providers to become a "virtual cable operator." The service would reportedly come with a monthly fee, and would allow owners of the Xbox 360 game console to stream TV.

Microsoft is also reportedly pursuing a lesser option, which would allow existing cable subscribers to watch and interact with content via the Xbox, similar to how providers offer streaming services over the Web. The Redmond, Wash., software giant could also allow individual channel subscriptions, for networks such as HBO or Showtime.

Microsoft is looking to counter new products that launched this fall from Apple and Google in the set top box market. However, Microsoft's plans are said to be at least 12 months away, people familiar with the talks reportedly said.

In September, Apple introduced its new cloud-centric Apple TV, which sells for just $99. The device has limited internal storage and allows streaming of high-definition TV shows from Fox and ABC for 99 cents.

Apple had more ambitious plans for its new product, and pitched to TV networks a $30-per-month unlimited subscription plan. But networks allegedly rejected that idea, leading Apple to push for 99 cent TV rentals. And even that plan was rejected by major networks like CBS and NBC.

Google has faced its own share of problems with newly launched Google TV products running the Android operating system. While devices with Google TV initially had access to streaming Web content from network stations, many of those networks made efforts to block Google TV devices.

Makes sense. The new Apple TV is rather awesome. Used one for the first time over Thanksgiving and it adds another dimension onto any television it's attached to. Many televisions have the services increasingly built-in, though, so I'm not sure how long the third-party market for this stuff will last.

Microsoft is reportedly planning to take on Apple TV and Google TV with a new subscription service that will be delivered through the company's popular Xbox 360 game console.

Two anonymous people familiar with the company's plans told Reuters that Microsoft is in early talks with content providers to become a "virtual cable operator." The service would reportedly come with a monthly fee, and would allow owners of the Xbox 360 game console to stream TV.

Microsoft is also reportedly pursuing a lesser option, which would allow existing cable subscribers to watch and interact with content via the Xbox, similar to how providers offer streaming services over the Web. The Redmond, Wash., software giant could also allow individual channel subscriptions, for networks such as HBO or Showtime.

Microsoft is looking to counter new products that launched this fall from Apple and Google in the set top box market. However, Microsoft's plans are said to be at least 12 months away, people familiar with the talks reportedly said.

In September, Apple introduced its new cloud-centric Apple TV, which sells for just $99. The device has limited internal storage and allows streaming of high-definition TV shows from Fox and ABC for 99 cents.

Apple had more ambitious plans for its new product, and pitched to TV networks a $30-per-month unlimited subscription plan. But networks allegedly rejected that idea, leading Apple to push for 99 cent TV rentals. And even that plan was rejected by major networks like CBS and NBC.

Google has faced its own share of problems with newly launched Google TV products running the Android operating system. While devices with Google TV initially had access to streaming Web content from network stations, many of those networks made efforts to block Google TV devices.

Microsoft is always playing catch up to Apple in every aspect of its business. \

Actually, other than grafting a GUI on top of DOS back in the 80s Microsoft has been more or less in parity with Apple in terms of innovation and first-to-market. The big difference is Microsoft used to release all sorts of unusuable crap as a pre-emptive strike against competition because their customer base would buy it first. Coupled with well-applied Fear, Uncertainty, and Doubt they would establish a market toe-hold and take it from there.

Since around 2000 (the Ballmer Decade), however, this formula has been failing Microsoft. Microsoft beat Apple to touch interface, smart-phones, tablets, home entertainment --give or take one's definition of same-- but the public wasn't buying. Meanwhile, Apple adopted the policy of only releasing refined products that actually work, while keeping the development secret. Obviously this strategy has worked well, and Apple has the technical proficiency to pull it off.

Microsoft still beats Apple handily in a number of areas --office apps, game console, server software, development tools, mapping and search, to name a few-- but other than with the Xbox they simply cannot muster decent consumer products. In that area Ballmer has a black thumb and simply doesn't get it.

I'm glad Apple TV never launched a subscription service. The new Apple TV seems to be having a hard enough time keeping up with streaming rentals as it is. It always stalls and freezes when I try to rent a movie or TV show on weekend nights - in contrast my laptop can download the same content from iTunes over wi-fi just fine. I would be far less tolerant of paying a monthly subscription fee only to have the same streaming problems.

... a new subscription service that will be delivered through the company's popular Xbox 360 game console..... Microsoft's plans are said to be at least 12 months away, people familiar with the talks reportedly said.

There are options to set the streaming quality (low/medium/high), while on-demand content is a download file (which plays while downloading). For streaming channels it has to cache 5-10 seconds before it starts or changes channel, to handle the vagaries of inconsistent internet. The base package has 10 "live" (streaming) channels. Extra packs have a combination of streaming & on demand (catch-up TV) channels.

Makes sense. The new Apple TV is rather awesome. Used one for the first time over Thanksgiving and it adds another dimension onto any television it's attached to. Many televisions have the services increasingly built-in, though, so I'm not sure how long the third-party market for this stuff will last.

what does apple TV do that x-box and PS3 don't do? youtube is better on the apple tv than the PS3, but that is going to change soon.

my point is that devices that have netflix and youtube already have installed bases in the tens of millions. the only people buying apple TV are those without a game console and/or internet enabled blu ray player or TV

i have 3 iphones in the house and planning to buy into the ipad 2 next year, but everything else apple does seems to be a niche market

What Steve Ballmer and the rest of Microsoft do not realize is that not everyone is a gamer. Having an AppleTV like approach to the Xbox will not appeal to the non gamer generation. Apple on the other hand made the AppleTV appeal to everyone with the addition of apps and games to be forthcoming, thus making it more of a platform of choice for everyone.